30 Sep How To Qualify For A Mortgage With A Low Monthly Income?

Need a mortgage but worried about if you’ll qualify or not? It may be difficult to obtain a mortgage, but for certain borrowers having established companies, bank statements or reference letters may be sufficient to get approved for a mortgage. It may be difficult to obtain a mortgage for borrowers with newly started cash companies, and bank statements or reference letters may not be sufficient for approval.

Borrowers try sealing a mortgage deal when the interest rates go down, but often forget to consider their annual income. If you are unable to demonstrate sufficient income to qualify for a mortgage, banks may reject your application but alternative lenders can lend more based on your overall ability to pay. 

Here are four ways lenders can qualify you if your present salary is insufficient.

1. Contributory Income

Family members frequently contribute to bills – think of granny living in the guest room or your parents in an in-law apartment. These family members may not have title to the property, but alternative lenders will consider their payments when determining your eligibility for a mortgage.

Some lenders will accept well-documented part-time or gig income instead of the standard two-year income history. Bank statements or reference letters may be sufficient verification for some borrowers who have new cash enterprises. Consider having that approved at a large bank, especially if you have a low credit score.

2.Future Income

Professionals like as doctors, dentists, and lawyers can nearly count on an increase in income in the future, and many lenders are willing to bet on it. Non-professional borrowers who anticipate receiving child support, alimony, rental, or pension income in the near future may also be eligible.

Even newcomers who have just started a business in Canada or who are migrating from a solid paycheck to self-employment can find lenders prepared to help. They only need to show that their income stream is established.

3. Liquid Assets

Some lenders determine how much you can afford by assuming you can convert your assets into cash. Cash or anything that can be easily converted to cash, might assist a lender justify deviations from its debt ratio rules. Some lenders will even consider RRSPs as a reason to approve a larger loan amount.

4. Future Assets

Borrowers who have listed another property for sale, have a trust fund coming available, or anticipate receiving an inheritance during the mortgage term all have future cash availability. Alternative lenders frequently use a percentage of such assets to service debt or pay off the mortgage.

Some would even accept retained cash held in a business account as long as it is free of debt and you have unrestricted access to it at all times.

If you are looking for a reliable mortgage broker in Abbotsford, who can help you find the best mortgage deal from a network of lenders, rely on none other than Satbir Bhullar Mortgages. With years of experience in the mortgage industry, we assist potential home buyers in getting access to the best mortgages in Abbotsford. For more details, give us a call.